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Annual Report 2008 - AMG Advanced Metallurgical Group NV

Annual Report 2008 - AMG Advanced Metallurgical Group NV

Fuel Efficiency

Fuel Efficiency Aerospace manufacturers seek to expand titanium usage in planes to reduce weight, thereby improving fuel efficiency and reducing CO 2 emissions. Liquid hydrocarbons remain the most common form of fuel for aerospace. These fossil fuels are major sources of carbon dioxide emissions. Major technological breakthroughs regarding low emission fuels are not on the horizon and reductions of CO 2 emissions are best achieved by reducing fuel consumption, which is mainly driven by reducing weight and increasing the efficiency of engines. AMG plays an important role in the production of light weight materials used to reduce fuel consumption. AMG’s Engineering Systems Division is one of the largest designers and producers of vacuum melting and remelting furnaces for titanium worldwide. AMG’s vacuum furnaces are used to purify and refine the structure of high-purity superalloys and titanium alloys. These high-purity materials are essential for applications in the aerospace industry. Estimated titanium required to manufacture each plane (MT) 38 Section Content to go Here

Market Focus Report Major technological breakthroughs regarding low emission fuels are not on the horizon and reductions of CO 2 emissions are best achieved by reducing fuel consumption, which is mainly driven by reducing weight and increasing the efficiency of engines. Titanium Value Chain Ilmenite or Rutile Ore Titanium Sponge Melting & Alloying Forging Rolling & Machining Components for Aerospace Industry The Advanced Materials Division manufactures master alloys which dramatically improve the mechanical, corrosion and heat resistance properties of titanium alloys and titanium aluminides used in the aerospace industry. AMG’s specialty alloys are key components in the development of the most advanced and fuel efficient aerospace engines. These specialty materials enable the engines to run at higher speeds and temperatures, thus increasing fuel efficiency. These alloys are also used to improve the quality and performance of aerospace-grade titanium, expanding the number of applications in which airframe producers can utilize the lightweight material. The use of new composites and titanium products has enabled Boeing’s 787 Dreamliner and Airbus’ A380 to achieve significant improvements in fuel efficiency above existing commercial aircraft. For example, Boeing’s 787, with titanium comprising 15% of its total weight compared to 4% for Boeing’s 737, is estimated to reduce fuel consumption by 20% over predecessor jets of similar size. This equates to an estimated reduction of one to two million tons of CO 2 emissions annually. These strong and lightweight materials are used not only in the general structure of an aircraft’s body but also in the engines, landing gears, hydraulic systems and galleys. Long-term increases in aircraft build rates will lead to continued growth of the titanium industry—and AMG will actively participate in that growth. In addition to aerospace applications, AMG is also active in developing metals-based materials to improve wear resistance, reduce heat loss and improve operating efficiencies of existing technologies. Over 62% 1 of a fuel’s energy is lost in the internal combustion engine, due to friction and energy loss. AMG’s advanced coatings development center in Germany is developing and producing DLC—diamond-like carbon-based wear-resistant coatings that dramatically reduce engine friction, thus increasing engine performance and improving fuel economy. 1 United States Department of Energy – Consumer Energy Center www.fueleconomy.gov Section Content to go Here 39

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